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Customer data platforms (CDPs) are much easier to establish and maintain than a traditional data warehouse. However, if you want to enjoy the full benefits of this ready-to-use and off-the-shelf solution, then you need to employ a CDP management strategy. This way, you can ensure that your CDP is always providing you with the highest possible level of insight.
In this blog, we’ll discuss how to manage a CDP and the benefits you’ll receive from actively managing the platform. But first, let’s have a quick refresher on what a customer data platform is and the data it requires.
What is a customer data platform? CDPs explained
In 2013, respected analyst David Raab defined a customer data platform as ‘a marketer-managed system that creates a persistent, unified customer database that is accessible to other systems.’
Essentially, this means that a customer data platform (CDP) is a pre-built system that centralises customer data and makes it available to other systems. This data can then be used for marketing campaigns, customer service initiatives, and customer experience surveys.
What data is included in a CDP?
To create a database, a customer data platform pulls behavioural data, transactional data, and demographic data from multiple sources. It then unifies it, ensuring all your customer information is in one place. In doing this, the CDP generates a complete view of your customers on an individual level. It also allows you to recognise every unique customer through all their activity with your brand.
Once customer data has been collected from sources like your company’s website, Facebook page, and email database, customer profiles are stitched together by the CDP. These are then distributed to delivery platforms so they can be used for marketing purposes.
Generally speaking, there are four main kinds of data that customer data platforms collect and organise. These are:
Identity data builds the foundation of each customer profile. After all, identity data allows a business to uniquely identify each customer. Forms of identity data include:
- Name information
- Demographic information, such as age and gender
- Location information, such as a customer’s address, city, and postcode
- Contact information, such as a phone number and an email address
- Social information, such as a Twitter handle or Facebook profile
- Account information, such as the customer’s user ID
Descriptive data expands on the identity data and provides a business with a fuller picture of its customers. Examples of descriptive information include:
- Career information, such as previous employers, industry, income, and job level
- Lifestyle information, such as the type of home, vehicle, and pet
- Family information, such as the number of children and marital status
- Hobby information, such as magazine subscriptions and gym memberships
Quantitative data allows businesses to understand how each customer has engaged with their company and its products. Quantitative behaviour includes:
- Transaction information, such as the number and type of purchases or returned products, the number of abandoned baskets, and order dates
- Email communication information, such as email opens, email click-throughs, email responses, and dates
- Online activity information, such as website visits, website click-throughs, product views, and social media engagement
- Customer service information, such as communication dates, query details, and service representative details
The final type of data included in a customer data platform is qualitative data. This is used to provide context for customer profiles. It also gives the profiles personality. As a result, it focuses on the motivations, attitudes, and opinions of customers. Qualitative data includes:
- Motivation information, such as how the customer heard about your business, why they made a purchase, or why they chose a particular product
- Opinion information, such as how the customer rates your product and your customer service
- Attitude information, such as the customer’s favourite colour or food
Making the most of your CDP
One of the main benefits of a customer data platform is that it allows you to unify all of your customer data from a wide range of sources and channels. As a result, you can say goodbye to data silos.
Using a market-leading solution such as an Apteco CDP, you can make sense of raw, multi-channel data and turn it into a source of competitive advantage. Plus, by gathering data from a variety of places, you can generate a powerful understanding of each prospect and customer.
Making the most of your CDP means actively using the insights that the platform provides. After all, a CDP is much more than just a database library. It gives you the tools to be proactive (such as data analytics and data cleansing). Using these tools, you can create marketing campaigns that deliver even greater value.
Managing your CDP effectively
When managed effectively, your CDP can help you pinpoint the ideal audience for a campaign. It can also help you master personalisation and help you track the customer journey.
On top of this, your CDP can also help you understand your prospects and customers. This way, you can ensure you always send highly relevant marketing messages to the right audience.
The benefits of managing your CDP
In truth, CDPs require very little physical management from either IT teams or marketers. This is actually one of the main benefits of a CDP. It means that the platform is easy to use and doesn’t require too much IT/development time, which can often hold up the process. That said, it’s still vital that you employ a CDP management strategy and ensure your CDP is functioning correctly.
By actively managing your CDP, you can ensure that the platform is processing the correct information and providing you with the highest possible level of insight. The best CDPs continue to ingest new data from various sources, maintaining a continually evolving, up-to-date history of customer interactions. Due to this, by managing your CDP effectively, you can ensure you’re always processing the latest data and generating high-performing insights.
Remember, CDPs store data over long periods. This is necessary so that marketers can build in-depth and accurate customer profiles that can be used to nurture customer relationships. Added to this, a CDP can share and draw data with any system that needs it to influence all types of marketing. Due to this, you must ensure your CDP is processing the right data. After all, if your CDP is drawing on inaccurate or incomplete data, your insights will be flawed.
The risks of not managing your CDP efficiently
As a marketer, it’s vital that you remember that your customers are never static. As their circumstances and life events change, so will your relationship with them. Successfully recognising this and changing the tone and angle of your marketing is crucial to remaining relevant. If you fail to manage your CDP and work with out-of-date data, then you’ll send outdated and irrelevant campaigns that fail to convert.
If you fail to manage your CDP effectively, then out of date, inaccessible, unorganised, or incorrect data may be in the platform. If you use this data when creating campaigns, you’ll draw inaccurate conclusions that could send you down the wrong path. As a result, if you want to maximise the ROI of your campaigns, then it’s vital that you routinely audit your data stack and build a culture around documentation.
But, as well as auditing your data, you should also run a complete CDP evaluation as part of your CDP management processes. Continually ask yourself:
- Does my CDP have the capability to collect all of the data I need to understand product performance and user engagement?
- Will the CDP enable us to resolve cross-channel data to unique customer profiles?
- Does the CDP integrate well with the tools and systems used across the business?
- Does the CDP make it possible to access a unified view of the customer without developer support?
- Does the CDP make it easier to deliver personalised customer experiences?
If the answer to any of these questions is ‘no’, then you may be using a CDP that’s unsuitable for the requirements of your business. If your business has outgrown its current CDP, or the CDP no longer meets the requirements of the business, then it may be limiting your growth and the effectiveness of your campaigns.